Gold and Silver Demand
Negative sentiment toward Gold and Silver is hitting extreme levels. It is very difficult to find any positive commentary about the metals in the mainstream financial press. What is so interesting is that demand for Gold and Silver coins and bars is soaring, yet the anomaly is that the paper price in the futures exchanges continues to fall.
Below are some highlights about physical Silver demand.
- It is being reported that the US mint has run out of America Eagle Silver coins. The collapsing price has fueled a buying frenzy in Physical Silver. The US Mint will not be taking any new orders until August.
- According to an article by SRSrocco, the latest data through April show that India Silver imports are running about 30% above the 2014 record pace. The article goes on to say that India Silver imports for 2015 could consume 1/3 of world Silver mine supply available in 2015. (Source: SRSrocco 2015 June 10th)
Below are some highlights about physical Gold demand.
- According to an article in Kitco, German investors have been jumping into Gold, protecting themselves against a falling Euro and geo-political uncertainty. The Greek credit crisis was another major reason behind the rush into Gold. (Source: Kitco 2015 July 8th)
- According to an article by Casey Research, Last week, the UK Royal Mint reported that Greek customers bought twice as much sovereign gold bullion coins as usual. The buying surged when the government closed the Greek banks. (Source: Casey Research 2015 July 9th)
It looks as though Germans and Greeks have been attracted to Gold as a way to protect savings from the financial instability the Greek crisis is causing in Europe.
Silver/Gold Ratio hit 78:1 this week
After Silver briefly fell below $15 this week the Silver/Gold ratio grew to just over 78:1. That means that it took approximately 78 ounces of Silver to buy 1 ounce of Gold. As of Friday the ratio now stands at about 75:1. To put this number in perspective the ratio dropped to 17:1 back in the early 1980’s when Gold topped out at $850 and Silver at $50.
Both Gold and Silver are searching for a bottom. Physical demand for the metals looks to be strong in many parts of the world. This suggests that despite what the mainstream press would have you believe, Gold and Silver are still recognized as the ultimate form of wealth preservation.
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